‘Falling input costs will check inflation’
PA Wellington Falling input costs for industry will help keep inflation low over the next year, said the Associate Minister of Finance, Mr Falloon, yesterday. Figures from the Producers’ Price Index show that the annual rate of increase has fallen from 16.7 per cent in June last year to 9.2 per cent in March this year. Mr Falloon said that while the final effect of the exchange rate movement could not be anticipated, there was no doubt industry could work “with some certainty” on the basis that input costs would stay close to the present levels. Producers would be able to price their goods more effectively than in the past. The drop in input costs
would help keep inflation low over the next year to 18 months - “provided the community is single-minded in its approach to inflation.’ Mr Falloon said that the items contributing to increases in input and output prices were mainly related to last year’s fuel price increases and improved export prices for items such as forestrv and logging. “There are also some costs to local government related to fuel price increases flowing through to increased reading costs. The rental increases before the freeze last year also contributed to the annual rate.” Industries paid 9.2 per cent more for goods and services, excluding labour, in the March, 1983, quarter, than in the corresponding quarter last year, the Statis-
tics Department said. This was the lowest annual increase since figures were first kept in late 1977, and compared with a rise of 12.2 per cent between the March quarters of 1981 and 1982. Compared with the December quarter last year, the cost of goods and services to all industries was up 0.4 per cent. The corresponding increase 12 months before was 3.2 per cent. The increase in the level of industry output prices was also the lowest since 1977, rising 8.3 per cent between the March quarters of last year and this year. The increase in output prices between the December and March quarters was 0.8 per cent, compared with 3.7 per cent a year before.
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Press, 29 June 1983, Page 4
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353‘Falling input costs will check inflation’ Press, 29 June 1983, Page 4
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